In just a few years, NFTs have become a mass phenomenon that has generated a multi-billion-dollar market. Therefore, there are many brands that have decided to leverage NFTs within their marketing strategies. But what exactly are NFTs? How are they used? Let’s see 4 successful examples.
Originally, the internet was populated with images of kittens, videos and gifs. With the advent of Web 4.0, however, it seems that another animal is taking over: the bored ape. The images of the “Bored Ape” series are in fact very popular among the early adopters of a new digital phenomenon: NFTs.
Blockchains and cryptocurrencies are gaining more and more importance both in the digital and in the real world, consequently there are many sectors that are developing related tools to leverage their potential (and exploit their fame). These include NFTs, works of art that have a unique certificate of originality, which gave way to the phenomenon of “crypto art“.
The first digital artworks characterised that are “non-fungible tokens” were created in 2017 by CryptoPunks. However, it was in the following three years that the NFT market became very successful. In 2021, the NFT phenomenon definitely exploded:
- In February, Chris Torres sold the Nyan Cat meme for $580,000.
- In March, auction house Christie’s sold The Last 5,000 days, an NFT made by digital artist Beeple, for $69,3 million – making its author the third most valuable living artist.
- Jack Dorsey, the founder of Twitter, sold the NFT of his first tweet for $2,9 million.
In total, sales of NFTs are estimated to have generated around $ 2.5 billion in the first half of 2021.
The economic value of NFTs has therefore attracted the attention not only of digital art collectors, but also of many well-known brands that have identified new marketing opportunities in non-fungible tokens. Starting from the last months of 2019, some brands in the fashion and food & beverage sectors such as Nike and Budweiser have decided to exploit NFTs in their marketing strategies, creating unique and customised versions of their logos and products.
Marketers are therefore quickly realising that marketing strategies involving NFTs can be an effective tool for creating brand awareness, increasing user engagement on social media and improving the relationships that brands have with their target audience.
But what are NFTs exactly? How is it possible that they are unique artworks? And how can they be exploited by brands? Let’s find out together!
Table of contents
What NFTs are and how they work
NFTs (Non-Fungible Tokens) are blocks of unique and non-reproducible data stored on a digital register that provides a certificate of authenticity and uniqueness. NFTs are based on blockchain technology – a shared and immutable ledger that records and tracks assets in a trading network – and are entirely digital assets, just like cryptocurrencies. Unlike Bitcoin or Dogecoin (two of the most famous cryptocurrencies), which are interchangeable with each other as a virtual currency, these assets cannot be replaced: the term “non-fungible token” means that an object (even virtual) is unique and cannot be replaced by something else or reproduced.
As a matter of fact, when a NFT is stored on a protected blockchain, the only one can access it is the owner of the encrypted key. And it is precisely the blockchain that provides the guarantee of the uniqueness, non-replicability and authenticity of a specific NFT. In fact, in the normal digital context, it is usually not possible to distinguish the original version of a photo, image, video or music file from the respective copy. But a NFT allows you to provide irrefutable proof of the ownership of that digital asset: the blockchain acts as a certificate of ownership and the purchase of the NFT is regulated by a contract that guarantees its uniqueness and regulates future ownership changes.
The reasons behind NFTs’ success
Although it may be difficult to verify the authenticity of a luxury item or an artwork, thanks to NFTs it is possible to instantly determine whether an asset is truly authentic. Their characteristics make these certificates particularly suitable for digital artworks, digital collectibles, music, memes, GIFs and tweets. Therefore, it is not surprising that US celebrities and influencers such as Snoop Dogg, Stephen Curry and Jimmy Fallon have decided to invest in this new technology and purchase a digital artwork.
The features mentioned here sparked another, strictly connected phenomenon, which has contributed to expanding the fame and consequently the push to purchase NFTs: users interested in the world of NFTs have formed an online community of enthusiasts and early adopters that is amplifying their success. Not to mention the hype created by media and the FOMO (Fear Of Missing Out), the feeling of anxiety experienced by those who fear being deprived of something important if they are not assiduously involved and don’t talk about it on social media.
In addition, the announcement of the Metaverse gave further impetus to NFTs: the tokens can be linked to a multitude of experiences covering different sectors, such as fashion and gaming. In the multiverse it will in fact be possible to create your own 3D avatar and embellish it with garments or accessories via NFT.
NFTs and marketing
As mentioned at the beginning of this article, brands and marketers are also trying to capitalise on the NFT phenomenon. There are now many companies that have decided to focus on the digital connection of unique works through marketing strategies aimed at promoting the brand.
Thanks to their uniqueness and exclusivity, NFTs can be used to obtain an economic return but also to create entirely personalised user experiences and address specific messages to a target audience.
Let’s now look at some examples of successful marketing strategies involving NFTs.
The company is already known for the value that the limited editions of its shoes can reach on the market, so it’s no surprise that their digital versions have also generated huge revenues.
The NFT CryptoKicks collection was auctioned on the OpenSea online marketplace at an initial cost ranging from $ 4,000 to $ 9,500. However, the offers increased immediately and some NFTs reached a value of $ 100,000.
The peculiarity of these NFTs is that they are customisable: buyers can in fact change the colour of the “Swoosh” (the classic Nike logo), of the straps and of the tongue. The company has exploited its notoriety as a brand coveted by collectors and the opportunities offered by the blockchain to create new versions of its products and make its most loyal customers happy.
Macy’s department store has decided to launch 9,510 NFTs as a digital version of its 95th Thanksgiving Parade collection. This celebration, which takes place in New York, usually features giant balloons that for almost a century have coloured the streets of the city during the event. The company used its archive to digitise these balloons and create unique artworks that were put up for auction.
Macy’s has decided to donate all profits from this initiative to the charity Make-A-Wish Foundation, which is dedicated to fulfilling the last wishes of children with serious illnesses. The highest bid for a single NFT was $ 310,000. In addition, the business took advantage of the smart contracts granted by the blockchain technology to ensure that a 10% commission on any resale in the secondary market was also donated to the Foundation.
In some cases, NFTs have also been given away to customers who have completed a purchase. This is the case of the Coachella Music & Arts Festival, a two-weekend event held in California which features the performance of several international musicians. What made the April 2022 edition unique was the NFT Blooming Flower series. The festival gave attendees the NFT of a flower that blossomed on the first Friday of the festival.
Once blossomed, the flower could be used as a pass to access further events. Additionally, Coachella has decided to leverage the event’s notoriety to market other NFTs and unique lifetime passes that have brought the festival over $ 1.4 million in revenue. The festival isn’t the first event to use NFTs alongside tickets: this technology has already been used for sporting events and film screenings. But the attention generated by Coachella and the interest in NFTs ensured its success.
The US lager beer company Budweiser announced on Twitter in late November 2021 that it would release 1,936 NFTs for its new “Budverse Cans Heritage Edition” collection. The set of 1,936 digital cans, which celebrates the year the company was founded, is made up of unique images that contain historical photos and images taken from the most famous Budweiser ads.
Not even a week later, the company announced that it had sold all the NFTs and therefore asked its customers to retweet the post using the hashtag “#BudverseNFTGiveaway” to try to obtain an additional NFT.
Thanks to this marketing campaign, the Budweiser brand has gained a lot of coverage in the press and on social media, creating an initiative that has been highly appreciated by customers (who have also been able to resell NFTs and make money). It was also a good return on investment. Although some brands choose to sell NFTs for free, the US company has decided to sell them (albeit at a relatively low price) to maximise the profits from this strategy.
In just a few years, NFTs have gone from being a cult object for a niche of enthusiasts and early-adopters to being a multi-billion-dollar phenomenon on a global scale. Consequently, these assets have crossed the boundaries of crypto-art and have attracted the attention of brands operating in the most varied sectors.
As we have seen, NFTs can be sold or used within a broader strategy, be it to make customers happy with unique and collectible items or to ensure access to additional events and exclusive activities.
There are now many brands, in addition to those mentioned in this article, that are implementing marketing strategies using NFTs. The interest in Non-Fungible Tokens, cryptocurrencies and the blockchain can be leveraged to increase the awareness of one’s brand and take part in the conversations of enthusiasts, who are inclined to purchase digital assets that they consider precious. Therefore, linking the value of this technology to your brand could prove to be a winning move.
What do you think about it? Have you ever bought an NFT? Do you think they are a good investment? Will they represent a new tool for brand marketing and communication strategies or are they a phenomenon destined to run out soon? Tell us your opinion in the comments!
As this article demonstrates, NFTs can be sold to generate immediate revenue, but they can also be used to generate brand awareness and get people talking about your brand. However, to be successful in the current media landscape, it is necessary to study a careful marketing and communication strategy and consider multiple approaches. EOS Mktg & Communication can help you develop a strategy and better manage your company’s online presence. Visit the page dedicated to our services or write to firstname.lastname@example.org to receive more information.